The UK is lagging behind other European countries by failing to recognise the role grandparents play in looking after children, a study claims.
The report by Grandparents Plus claims one in three mothers in the UK rely on grandparents to provide childcare.
It says the state gives little financial recognition for this caring role, unlike other European countries.
Grandparents should not be taken for granted as cheap childcare, says the report.
The study - written in partnership with the Beth Johnson Foundation and the Institute of Gerontology at King's College London - said many grandparents struggled to juggle work and childcare, without financial support.
It said that a number of EU countries had taken steps to help grandparents.
This included measures to allow parents to transfer parental leave to grandparents, letting working grandparents take time off if their grandchild is sick and, in some circumstances, paying them for the care they provided.
The report acknowledged that from April next year, grandparents in the UK would be able to claim National Insurance credits for the care they provided.
But it said they did not currently have a right to request flexible working and parental leave could not be transferred to them.
Parents also could not use childcare vouchers, which are taken from their salaries before they pay tax and National Insurance, to pay grandparents, the report said.
Research carried out for the report found that seven out of 10 grandparent carers thought they should be paid through tax credits or childcare vouchers for childcare.
Nearly half of all grandparents who looked after their grandchildren said they would opt for flexible working if they were allowed.
And 53% of grandparents aged between 45 and 54 thought grandparents should be given time off work when a grandchild is born.
Dr Karen Glaser, a specialist in ageing who helped write the report, said there needed to be a system in place whereby parental leave from work could be transferred to grandparents.
"There are more women in employment and grandparents are absolutely instrumental in terms of child care," she said.
"And lastly there have been significant changes to family lives, so in terms of increasing levels of divorce and one-parent families and a lot of research has shown that grandparents are absolutely crucial, especially at times of family crisis."
Sam Smethers, chief executive of Grandparents Plus, said: "National Insurance credits from April next year will certainly help to protect their [grandparents'] pension entitlement, but this won't help them now.
"We have to match it with steps towards transferable parental leave and flexible working if we really want to make it easier for them to combine work and care."
The Family and Parenting Institute also warned that poorer grandparents were at risk of being exploited by the state as a "cheap safety net for childcare".
Dr Katherine Rake from the institute said grandparents were not just expected to care for their grandchildren, but they were also increasingly having to support their adult children as well, as many were divorced and financially vulnerable.
The group said poorer grandparents were especially likely to feel the strain of helping care for their grandchildren, as they were more likely to become grandparents before they retired, while their own children were also more likely to be single parents and need extensive childcare support.
Dr Rake said: "These working-class women, who have attempted to juggle their family and their careers for decades, now find that grandmotherhood offers no relief.
"They will always want to contribute to the welfare of grandchildren - but they don't want it foisted on them by a state that either ignores or assumes their assistance.
"We must ensure that the joy of grandparenting prevails."